The UK’s BRC Shop Price Index saw a decrease in prices, falling from 1.4% to 1% in October. This indicates a shift in pricing trends in British retail. In the gold market, prices bounced back from a two-week low. This change was influenced by a weaker USD and hopes for interest rate cuts from the Federal Reserve.

Surge In Cryptocurrency

In cryptocurrency news, the official Trump memecoin surged over 20% after American Bitcoin purchased 1,414 BTC, worth more than $160 million. Market sentiment changed as confidence in the USD declined, leading investors to switch to assets like gold and Bitcoin. The USD/CAD pair remained below 1.4000 due to the Federal Reserve’s cautious approach. In energy markets, WTI crude oil prices fell to around $61.00, with expectations of OPEC+ increasing production in their next meeting. The latest UK shop price index shows inflation slowing to 1.0%, confirming a trend of decreasing prices we’ve seen for months. This follows the Consumer Price Index data from the ONS for September, which reported a headline rate of 2.1%, down from 2.4% the previous month. For traders, this easing price pressure suggests the Bank of England might keep interest rates steady, which could limit gains in the GBP/USD pair, currently near 1.3300.

Dominant Market Driver

The main force in the market is the expectation that the Federal Reserve will cut rates in its next meeting. According to the CME FedWatch Tool, futures markets show an over 85% chance of a 25-basis-point cut. This is leading to widespread weakness in the US Dollar and contributing to gains in pairs like EUR/USD and AUD/USD. The Fed’s cautious stance is supportive of gold, even though progress in US-China trade talks may limit its potential. We’re keeping an eye on whether gold can hold support at $3,973 and regain the 21-day moving average near $4,061. Since gold broke its all-time highs in 2024, dips related to risk-on sentiment have often presented buying opportunities. In energy, crude oil is showing signs of weakness, with WTI falling towards $61 a barrel. This drop is not due to a lack of demand but signals that OPEC+ is likely to boost production quotas at their next meeting. After maintaining production levels for much of the year, this would represent a significant policy change, potentially driving prices down in the short term. We’re also seeing signs of a “Great Debasement” trade as trust in the US Dollar wanes, pushing investors toward alternatives. The recent $160 million Bitcoin purchase by American Bitcoin exemplifies this shift. This trend suggests that call options on assets like Bitcoin and gold could be smart strategies for anticipating further long-term devaluation of the US Dollar. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now